Victory by the rebel United Front for Change, a coalition of three forces, would have important regional consequences. Chad is home to about 420,000
refugees from Sudan's Darfur region, who may be made more vulnerable by a rebel victory because of the UFC's ties to the government in
Khartoum. About 180,000 Chadians have also been forced into camps by the conflict.

EU ministers have approved the deployment of 3,700 peacekeepers to eastern Chad to protect refugees and aid operations from cross-border raids from Sudan but that has been held up by the sudden increase in fighting. The bulk of the force is to come from France, Chad's former colonial ruler. Rebels threatened to attack peacekeepers who stood in their way and one group has declared war on foreign troops.

The rebel assault may also impact on Chad's position as a major oil exporter since the completion of a $3.7bn pipeline linking its oilfields to terminals on the Atlantic coast, run by US and Malaysian multinationals.

Chad has also just signed a major joint venture with China, but most of the Chinese working in the African state have now been evacuated.